December 13, 2014 Monthly Open Meeting

meeting[1]Lola Lauri
Shall I just start with the big news? I suspect you all will simply skip to it anyway, so here it is: at the open meeting the Board of Directors voted to close the Community Center from January 2nd until May 2nd of 2015.
In attendance were Dan Glasgow, Buz Whelan, Diane Caldwell and Alex Leslie. Robert Lauri was attending through a Skype internet connection (that admittedly cut out several times throughout the meeting). Millie Bishop and June Solla were absent.
In his President’s Comments, Daniel Glasgow read an article that he had written that described a moment after the election when a member challenged him to “go out and do the right thing.” This caused him to reflect on what exactly this meant to him. He said that doing the right thing is not the same as doing the popular thing, or the easy thing, and it often involved choosing the lesser of two evils. He added that, in the case of board members, it also meant sometimes going against self-interest and doing what is best for the community. Next, he reminded the audience that the Board was facing important issues that need to be resolved. First, there is the “Membership Review”. For nearly its entire existence, ELA has had difficulties determining exactly who is and who is not a member at any given time. Previous boards have chosen to ignore this but, given the disclaimed audit last August, it must be settled once and for all. It will require targeted title searches and other work that will cost the community a considerable amount of money that was not accounted for in our budget. The second problem is the failing systems in the Community Center. The boiler, the HVAC systems, and the roof are, according to the Falcon report, in need of replacement or repair. The Bar and Grill is losing money when many feel that it should be making money or at least breaking even.
To fund this work, the Board has put together a plan to close the center and use the savings (along with thCA3ZBTNPsome other sources of funds to be discussed later) toward this effort. Glasgow asked the membership to understand that nothing is free and that sacrifices now will leave us all better off in the end.
Buz Whelan was up next, with the treasurer’s report. He began with the variance in Administration. This department is currently running $85k over budget. About half of this ($43k) is due simply to a change in bookkeeping procedures that require us to log the collections fees collected by our attorney as income (and then as an expense to the lawyer). Previously, we did not include these amounts on our books since it is money that never actually runs through our accounts, but is instead collected by the attorney directly from our creditors. The rest of this amount is due to the increased legal fees incurred largely for the membership review. From our other departments, Maintenance and the Community Center are slightly under budget due to lower salary and benefit costs, and Public Safety is slightly over budget due to extra patrols being sent out. Although the Bar and Grill continues to lose money, this month the loss was $1,645 versus the average for the first four months of $4,700 per month. This is considerably closer to what Whelan deems an “acceptable loss”. Dues collection is down nearly $30k over last year at this time, and collections on past due accounts is at $146.5K year to date, which gives us an average of $21K per month. Whelan cautioned that collections are historically lower through the holiday season and so we should expect this number to be lower in his next report. Overall, collection of late monies can be described as robust. He described this as one of the few bright spots in our financial picture. Our current cash balance of operation funds is $450K, about $83K over the same time last year. Reserves are at $344.5K, up from $261.5 at the same time last year. New capital reserves, those monies used for new projects or equipment, are a little over $52K. Money from these two reserve fund can be used for the Community Center renovations the board is planning for the period when the center is closed.
In the management report, Judy Kennedy reported that the concrete has been poured for the new buildings and construction would begin next week. The “scalping” project for the sides of the roads has been postponed due to the weather, but the contractor has agreed to perform this operation in the spring at the quoted price. She gave a prioritized list of repairs recommended by the Falcon report that included projected costs of each. The CC boiler ($65 – $75k), a new dehumidification system ($180k), and roof repairs (approximately $100 – 120K) were the first three items on that list. She noted that the indoor pool heater had been repaired and finally, she welcomed the new CC manager, Ana Crespi and said that she believed this hire would be a good fit for the needs of our community.
Addressing old business, the board stated their goals and objectives for the coming year. These included clearing up items left from the previous board, finding methods to generate revenue via short term rentals, enacting the CC recommendations as presented to the board by Robert Lauri, and completing the bylaws review and revisions. Diane Caldwell then read the “address the board” policy, and the lawyer’s opinions on the real estate committee and fishing club recommendations to the board. Real estate had recommended imagesCAVDSRC8that we limit short term rentals and apply fines and penalties to those who did not adhere to the policy. The lawyer’s opinion was that these were unenforceable and would not withstand legal challenge. Fishing and conservation had submitted rules and policies to regulate ice fishing within Emerald Lakes. The lawyer felt that this would then increase ELA’s liability and exposure to lawsuits. Finally, we learned that the Fishing and Conservation club had volunteered to wrap trees on the islands of Pine Tree and Mountain Top lakes.
Turning to new business, Glasgow stated that the membership review is projected to cost an additional $20 -30k before it is completed. Bill Henry was reluctant to comment on the research that he and Carmen Brodnax are doing toward this goal, since they have only begun the process, but he did state that he felt the whole issue was a cruel joke played upon our community. He said that the 2900 properties that the county has listed in our community “simply do not exist.” He pointed out that this would be approximately 450 acres unaccounted for, and that they may be counting our green areas, and also many properties were sold and listed more than once. Whelan opined that the auditor’s disclaimer did a real disservice to our community by stirring up a lot of fear and misleading the membership about the state of our finances. So, there are disputes with the county records versus our records over how many actual lots there are in ELA, but there are also the deeds that contained “clause 15”, a clause that set an expiration date on those properties’ obligations to the community, and there are properties that do not belong to ELA, but who use our roads to access their properties. Diane Caldwell expressed confidence that Mr. Henry and Ms. Brodnax would be thorough and diligent researchers in these matters.
thCATSXQGLAt last we came to the news everyone was waiting for, the closing of the Community Center. Citing the need for the savings that closing would bring, and the deferred maintenance and repairs of the boiler and other equipment, and the need to completely revamp the policies and procedures of the Bar and Grill, Dan Glasgow explained how Robert Lauri had presented the plan to the board at last week’s workshop, and they had worked out the details and come to an agreement on this plan. Caldwell read the resolution to the audience and the discussion began.
Via his Skype connection, Robert Lauri stated that he believed this resolution would work for the community on many levels and that even though it was a difficult sacrifice for so many of us, it was the best way to meet their fiduciary duty to ELA. He added that this would provide a “clean slate” for the Bar and Grill.
Buz Whelan pointed out that this was not without cost or pain for any of us, describing his pleasurable experience the night before in the dining room and how he would miss the ability to stop by in the evenings.
Diane Caldwell compared this to the experiences we all have with budgeting for our families and said she felt this solution solved a number of problems facing the association.
Earl Frank noted that an alternative place would be needed for the monthly board meetings.
Bob Leon supports the closing, but expressed concern that the timing was poor and that there was not enough time to begin work in January.
John Palmisano supports the closing, but wondered what would happen to the new CC manager. Brad Jones responded that she would be working on implementing new policies and procedures, would provide an onsite presence for the renovations, and that they felt they had enough work to justify her retention during the hiatus at the center. Palmisano also suggested that it would be a good idea to make sure the skating pond is open to provide at least one winter activity for the membership.
Joseph Olall asked about the savings the board hoped to realize for this project. He was told that Robert Lauri had calculated a savings of approximately $86k, including the cost of keeping the manager on during the closing. Olall also asked about the condition of the boiler. Mr. Jones responded that according to the inspection that resulted in the Falcon report, the boiler had exceeded its useful life and its inefficiencies were costing the community between $12 and 20k per year.
Rob Pavlasky added his concern about funding all these changes, and suggested that after paying the legal fees, these projected savings would leave very little for the renovations. Glasgow explained that in addition to those savings, the board would put off purchasing a new maintenance vehicle that had been budgeted for at $50k, and that many of the items would be paid for from the reserves fund, and Caldwell added that some of the legal fees had already been paid.
Bill Henry observed that it was a good idea to close it in any case as we were likely to run out of money to pay for it before the end of the fiscal year (May 1).
Margaret Fitzgerald and Heidi Castro felt that we did not need the manager to stay on during the closing; that Preferred Management could complete the renovations and design the new procedures. Ms. Castro said that if they were keeping the manager, they should just keep all the employees on the payroll. Buz Whelan responded that we could shift the responsibilities of all sorts of jobs in the community, but that this doesn’t mean it is a good idea. It makes sense that the person in charge of the center should be involved in its setup and design. Caldwell stated that they were not aware of the recommendation when the new manager was hired. When Ms. Castro complained that her children would have nowhere to go this winter, Whelan responded that they would certainly have nowhere to go if the place went bankrupt and was closed permanently.
Eileen Avrich said that the Events Committee recommends that management explore the option of enlisting volunteers from the community to complete some of the work.
Erika Wolf wanted to know why they didn’t plan the closing for the spring or summer months when the outdoor pool and beaches would be open for people to use. Stefania Johnson said that the CC is most crowded at those times and it would be better to close now. Johnson added that, as a member of the Events committee, and an avid user of the CC (she described it as her other living room) she knew the disappointment that many would feel with it being closed, but that she felt strongly that it was a worthwhile sacrifice. She said that she could “see the vision” of a new center, and she hoped that others would get on board as well. Ms. Wolf then wondered if the money for the legal fees could come from the funds set aside for the roads. This was met with a vehement no from several members, and it was explained that the last dues increase was promised to be dedicated to the roads and that trust could not be broken with the membership.
Linda Shuey supports the closing, and she suggested that we might be able to find other venues for activities. Caldwell, who used to work with the Pocono Mountain School District, pledged to help work with the schools to arrange this if anyone was interested.
Cathy Leach asked if anyone knew the percentage of the membership that actually used the CC, and Earl Frank put that figure at about 10%.
Darren and Stefania Johnson reminded us that we were all warned that without a dues increase, services would likely be cut, and now that the increase was rejected, it was up to all of us to support doing what is necessary for ELA. Darren added his kudos to the board for taking this action and reminded us that we are lucky to have a board that is willing to move on so many things when only six months ago our board was deadlocked on so many issues.
At this point, the vote was taken and all Board members present voted yes.
The next item discussed was banning ice fishing in our lakes and the installation of signs to warn others of this change. The Board believed that allowing ice fishing led to an unacceptable exposure to legal action against the association, and both our attorney and our insurance company advise against it. Director Whelan added that the ice fishermen he had seen do not “catch and release” and we could not afford to stock the lake for people who are taking them home to eat. Ms. Shuey asked if it was the regulation of ice fishing that created the exposure, and that if we simply remained neutral on the issue, as we had in the past, wouldn’t that be sufficient? She also asked about the possibility of purchasing a rider to our insurance to cover this activity. Brad Jones said that we were always vulnerable to legal action and that by taking the action of banning ice fishing we would be reducing that exposure. He also said that our current insurer would not sell a rider and that, in any case, the cost would be prohibitive. Robert Lauri asked if we could require a signed waiver for ice fishing, but Jones did not believe this would be sufficient to avoid legal action. All directors voted to ban ice fishing.
The Board also voted to spend $200 on supplies for the Fishing and Conservation Club to wrap trees on the Pine Tree and Mountain Top islands to protect them from beavers. Gilda Spiotta said that she believes that a 3 to 4 foot fence around each island would better protect those trees. She also expressed concern that we might be liable should one of the volunteers be injured while performing the work. Robert Lauri said that he would be taking a tour with Ms. Shuey and Ms. Spiotta in the near future to survey possible beaver damage to our waterways. The measure passed, with all present members voting yes.
The final two actions of the Board for the day were to pass a resolution setting the goals and objectives for committees, and a second reading of the variance policy that had passed at a previous meeting.

[Gilda Spiotta: Thank you for your notes. I was so busy fighting with the computer to keep Robert Lauri on the line, that I missed a lot and could not have written this without you! L]

Posted on December 15, 2014, in Uncategorized. Bookmark the permalink. Leave a comment.

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